The Olympic spirit and our managers

By Prof. Roland Berger

At first glance, managers and athletes have little in common. The former wear suits and wrestle with balance sheets, while the latter wear shorts and struggle with stiffness and fatigue. But first impressions can be deceiving.

More than just a forum for nail-biting contests, sports today is a business worth billions. As many as 1.5 million visitors are expected to attend the Winter Olympic Games in Turin alone. The Summer Olympic Games, traditionally better attended, brought Athens about 5 million spectators in 2004. Moreover, this one spectacular sporting event added 2.5% to the Greek GNP. Two years earlier, the soccer World Cup drove South Korea's GNP up by an astonishing 7%.

Aside from the financial benefits, staging the Olympics improves the image and recognition rating of the host city. As a rule, the positive impact on tourism is sustained for a long time after the event.

Sponsorship is another pertinent issue. A study by the Bertelsmann Foundation found that 38% of companies support sports clubs and individual athletes. Experts believe that this year's soccer World Cup in Germany will cost the corporate sector EUR 2.7 billion in sponsorship money. The reward is that sponsoring companies share in the positive image of successful athletes and teams. On track and field, the players' passion and performance stir up emotions – and stick in people's minds.

One niche within this broader category is the sponsoring of sports facilities. This kind of collaboration can give cities and clubs new sports arenas, while the sponsors benefit from a prestigious landmark that bears their name. A prime example of this is Munich's Allianz Arena, built at a cost of EUR 280 million. The Allianz Group contributed about EUR 90 million, thereby securing the naming rights through 2012. The two local soccer clubs, Bayern Munich and TSV Munich 1860, each shouldered half of the remaining cost and are now the legal owners. The public sector put up the money to expand the local infrastructure and ease access to the site.

However, sports and business have more in common than just numbers. In either discipline, you only win if you outperform the other players. Fitness to face the competition, dedication and endurance, team spirit, and a steely determination to succeed are vital assets both on the field and in the boardroom.

And last but not least: Just as sporting contests around the world are governed by clear rules that apply to everyone, so, too, must competition between global business players adhere to international guidelines. Today's globalized market demands clearly defined principles and efficient institutions such as the World Trade Organization (WTO). After all, fairness is a moral imperative in business, too.

(This column was published in "Rheinischer Merkur" on February 16, 2006)